WASHINGTON, D.C. (Wednesday, June 25, 2008) - Biotechnology Industry Organization (BIO) President and CEO Jim Greenwood released the following statement regarding the Congressional Budget Office (CBO) report issued today projecting cost savings from S. 1695, the Biologics Price Competition and Innovation Act of 2007:
“The CBO report shows that developing a pathway to review and approve follow-on biologics will result in cost savings to public and private purchasers of biologic products over a ten year period. The report finds that most of the savings will be obtained several years after a follow-on pathway is established, reinforcing the need for Congress to develop and pass a responsible pathway this year that protects patient safety and preserves innovation. We are essentially leaving money on the table the longer we wait to implement a pathway.
“By relying on the provisions in S. 1695, the CBO study also shows that we can achieve meaningful cost savings in biologics spending while providing needed protections to allow for continued innovation. H.R. 1956, the Patient Protection and Innovative Biologic Medicines Act of 2007; H.R. 5629, the Pathway for Biosimilars Act; and S. 1695 all come close to striking this necessary balance.
“Notably, the CBO study projects savings in-line with the estimates from the studies we, unlike others, have continued to reference, including those conducted by Avalere Health and by a research team led by Professor Henry Grabowski of Duke University.
“While follow-on biologics will provide real savings in the aggregate to the government and consumers, the estimated savings will constitute 0.065% of total healthcare spending over the next ten years. Therefore, Congress must ensure proper incentives for continued biomedical innovation in any follow-on biologics pathway so that we don’t achieve relatively minor savings as a percentage of overall health care spending at the cost of continued innovation.
“BIO will continue to encourage the House and Senate to consider and pass legislation to create a pathway for the approval of follow-on biologics which protects patient safety and provides incentives for continued innovation.”
The CBO cost estimate is available at http://www.cbo.gov/ftpdocs/94xx/doc9496/s1695.pdf